Solving The AI Bottleneck

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Credit Where Credit Is Due

The writeup that follows is due entirely to our longtime member “FredFrog” who in addition to being able to hold entire large-scale computer systems in his head, and to reverse-engineer LLM-based securities trading models in the same head at the same time, knows a good single-stock prospect when he sees one. “Fred” has been telling me about this company for a while now; I think he has a live one here.

Read on!

How To Win At Telco

by Alex King, CEO, Cestrian Capital Research, Inc

The reason most telcos are terrible companies is because most of the people that work there in senior roles have been brought up in telco. Child psychologists will tell you that if you show them the child at 7, they’ll tell you a lot about what kind of adult they will become. Well, capital allocators will tell you that if you show them the manager who has worked in telco for the first seven years of their career, they’ll tell you …. all the reasons not to allocate capital to that person.

At its heart, old-line telco - your AT&Ts, Verizons and whatnot - still think of themselves as a kind of national utility. Yes, the FCC did its best in 1984 to break up the AT&T monopoly, and for a while that worked - culminating in scores of altnet carriers springing up in cities small medium and large in the 1990s. But, telco executives being long-game types, in the end the FCC was end-run by a combination of (1) the complete unviability of city-ring fiber models (2) the subsequent ‘Escape From Telco’ capital flight in bond and growth equity capital markets (3) the delayed start to the Internet Revolution - the 2000s were a lost decade really - and (4) the general ineffectiveness of telecom regulation in the US and most everywhere else in the world but more than anything (5) the resting "Computer Says No” face of your average telco lifer senior executive.

• High-capacity interconnect at multiple peering points across major metros? Computer says no.
• Rollout of fiber in the last mile? Computer says no.
• Growth mentality to capture the ever-increasing value available from the digital revolution? Computer says no.

For a while it looked like the big long-distance powerhouses, Qwest, Level3, WorldCom (yes!) might transform their industries, but that soon ended in tears. Bondholder tears, shareholder tears, and family tears as executives did the perp walk.

Surely, you ask, 25 years after the Bondfire of the WANities, it has changed? Surely, given everyone’s complete reliance on comm in the smallest aspect of our daily lives, someone is doing telco right?

Well, the answer is, yes, I think probably there is. It’s a company now called